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THE REALIZATION PROBLEMS OF EFFECTIVE INTEGRATION METHODS OF THE ECONOMIC MODEL FORMATION OF AZERBAIJAN

Дата публикации: 24 июня 2010
Автор(ы): Shafa Aliyev
Публикатор: shafaaliyev
Рубрика: АНГЛИЙСКИЙ ЯЗЫК Best topics →
Источник: (c) http://portalus.ru
Номер публикации: №1277373849


Shafa Aliyev, (c)

Сайт автора: http://shafaaliyev.wordpress.com/

I. EXORDIUM

In the beginning of 90-es during more than 70 years the myth about the planned economy regulated by administrative-imperative principle and by the centralized management method failed with the dissolution of the Soviet Union. After this in the countries which received independence after the dissolution of the USSR and also in Azerbaijan the necessity of new economic development direction appeared. Therefore in this period Azerbaijan had not been only forming the independent economic policy but also had been conducting the works directed on creation of new commercial economic connections, on definition of priority directions in the foreign-economic connections and realization of the effective economic integration processes. All these were first of all explained by the followings:
- globalization and economic transformations are the reasons of necessity of the national economic processes development in accordance with world economic system
- the active inculcation of the effective economic methods becomes inevitable because of acceleration of the integration economic processes
- the profitable basis for realization of new economic methods appears because of intensification of Azerbaijan national economic model as the result of oil factor influence.


II. THE PECULARITIES AND CONCEPTUAL SIGNIFICANCE OF THE ECONOMIC REFORMS IN AZERBAIJAN

It will be observed that in process of the deepening of economic researches the precipitant integration of Azerbaijan national economic sectors directed to world economy system occupies the position in the lead in the region by the active economic connections of regional and international economic organizations and also by economic investigations. Alongside with it, none country will be able to ensure its stable economic development, and also economic safety, especially the safety of production, not participating in the active economic processes in the international trade branch. The experience of many economically advanced countries which play an important role in the formation of world economy system shows that these countries achieved the precipitant economic development in the result of effective economic connections with other countries.
If we analyze the economy development processes of Azerbaijan for last 100 years the given analyses will show that Azerbaijan possessing the immense quantity of natural and mineral resources have no opportunity to take part in integration processes with the world countries directly because of being the member of the USSR. So, this mission was carried out by the community, named the USSR which failed later.
Just after the disintegration of this community in Azerbaijan which became an independent country, the following directions of an active integration into the world economic system were defined:
-the necessity of conducting the complex and consecutive investigation
-the creation of independent foreign-economic policy
-the organization of integration of the national economic sectors into the world economic system and the necessity of gradual intensification of these processes
-the organization of the development level of the national economic sectors in accordance with world standards due to oil factor and the warranting of modernization on the basis of contemporary technology and reorganization in these branches
-to achieve the precipitant economic development with the help of new economic tools; the increase of living standard of population; the salvation of social-economic problems; maintenance of employment; downturn of unemployment rate and acceptance of measures under the active salvation of another social problems.

2.1 The theory and Contemporaneity: Realities and Views
It will be observed that under the theory of an American economist M.Porters every country must clearly define its primary factors (as a dominant) while forming its economic model. From this point of view the primary factor of Azerbaijan is the factor of maintenance by the energy carriers. [1]
Under the prognosis, if Azerbaijan use its natural resources rationally and provide the perfection of its foreign trade turnover it will take its deserving place in the world economic system.
In Professor Sh.G. Hadjievs opinion, the primary factor of the development of foreign-economy strategy of Azerbailan is the deep analysis of the world experience, the study of the strategy decisions of economic reform in other countries and also the analysis of national economy. [2]
The investigations show that in the period of active development of world economic system the international division of labour influenced every participant of this process effectively, and even many of these countries could reach the high level of economic development. These are explained by the following factors:
-the increase of the level of the national internal manufacture and the prevalence of competitive goods manufacture
-the absence of necessity of compulsory production of all consumer wares witch are essential for inner demand of the country and taking advantage of the demand due to the international division of the labour by import
-raising of the services sphere and priority economic sectors in the national manufacture of every country on higher level, using opportunities given by international employment department and the specialization in these spheres on the basis of made reconstruction and balancing and etc.

2.2 The ‘Open Doors’ Policy in the Context of Acceleration of the Integration Processes
If we consider the world economic system and integration sphere for definition of economic safety according to criterion of international trade department through a prism of “Open Doors” policy we shall see that Azerbaijan is on the same level with the developed countries of the world (Great Britain, Germany, Italy and etc.) according to export quota. As it is already known from what was mentioned above one of the main factors necessary for economic development of any country in the classification of International Economic Organization is the maintenance of these countries by the energy carrier. Thus the maintenance by these resources creates favorable conditions for organization of rational use of export potential, counterbalancing of its structure and extension of an assortment. The best example of this is the Organization of Petroleum Exporting Countries (OPEC). The export quota of Gross National Product in these countries composes more than %50 and in Azerbaijan more than %80of export structure compose oil and mineral oil. A very important role plays taking into consideration the above mentioned factor of the economic development process which takes place in the country now and the extension of manufacturing industry due to development of the non-oil sector and also the extension of non-oil production assortment in the export structure. It will be observed, that under the world expert-sassumption, many oil-and-gas countries with transitive economy (Russia, Azerbaijan, Kazakhstan, Turkmenistan and etc.) in spite of real success achieved in economic development processes will go on export their stock of natural resources for many years. Alongside with it, being the characteristic feature of many countries, reconstructions of branches of non-oil sector on the basis of modern technologies or modernization of existing manufacture-industrial potential (oil-and-gas, engineering, light and food-processing industry, textile industry, metallurgy, oil-chemistry branch, agriculture, and etc.) and precipitant development of new sectors of modern economics (the informational-communicative technology, tourism, services spheres and etc.) can be a ground for these countries to overcome the difficulties which turned out in the globalization process of world economy. From this point of view, the maintenance of Azerbaijan by raw material and energy-fuel maintenance of Azerbaijan industrial sectors is competitive and is not in need of passing of strict measures of safety only if the economic development process (reorganization and modernization) will not be delayed.
To our mind, the realization of precipitant development of the branch complex of the non-oil sector in Azerbaijan due to prevailing potential of oil-and-gas sector would allow to give a guarantee on fortification behind itself the place which our country occupies in the world economic system, the settlement of diversification problems of foreign-trade requisition, the increasing production share, which compose big business in export and leastwise for guarantee of the exported oil and mineral oil coming to non-oil sector during an active export period and for remaining this sphere be the main priority of export for the period when the oil stock gives out.

III. POST-SOVIET REPUBLICS ON THE TRANSITIVE STAGE

Years 2008 110.8 110.0 107.6 105.6 102.1 102.4 107.9 104.0 109.0 106.8 107.6 The volume of Gross National Product (in percentage) of the CIS countries with transitive economy in 1995-2008

2007 125.0 108.2 103.0 108.1 107.6 108.9 107.8 112.4 109.5 113.8 108.2
2006 134.5 110.0 104.8 107.4 107.3 110.7 107.0 109.4 107.3 113.2 103.1
2005 126.4 109.4 107.5 106.4 102.7 109.7 106.7 109.6 107.0 113.9 99.8
2004 110.2 111.4 107.4 107.2 112.1 109.6 110.3 105.9 107.4 110.5 107.0
2003 111.2 107.0 106.6 107.3 109.6 109.3 111.0 111.1 104.4 114.0 107.0
2002 110.6 105.0 107.8 104.7 105.2 109.8 110.8 105.5 104.0 113.2 100.0
2001 109.9 104.7 106.1 105.1 109.2 113.5 109.6 104.8 104.2 109.6 105.3
2000 111.1 105.8 102.1 110.0 105.9 109.8 108.3 101.8 103.8 105.9 105.4
1999 107.4 103.4 96.6 106.4 99.8 102.7 103.7 102.9 104.3 103.3 103.7
1998 110.0 108.4 93.5 94.7 98.1 98.1 105.3 103.1 104.3 107.3 102.1
1997 105.8 111.4 101.6 101.4 97.0 101.7 101.7 110.5 105.2 103.3 109.9
1996 101.3 102.8 94.1 96.4 90.0 100.5 83.3 111.2 101.7 105.9 107.1
1995 88.2 89.6 98.6 95.9 87.8 91.8 87.6 102.6 99.1 106.9 94.6
Countries Azerbaijan Byelorussia Молдова Russia Ukraine Kazakhstan Tadjikistan Georgia Uzbekistan Armenia Kirghizia
As we can see from the given table among the CIS countries with transitive economics Azerbaijan mended its priority according to GNP increase pace for last 4 years. [3] The priority of Azerbaijan among oil-and-gas countries (Russia, Kazakhstan and etc.) according to these main macro indexes draws attention. In the result of strategy arrangements in the sphere of oil extraction and use of oil factors, Azerbaijan outdoes the countries of the former USSR in accordance with economic development level of the countries with transitive economics for 2005-2008. It is explained by dynamic development of GNP increase pace, industrial development and other branches of non-oil sector and also the shop of this economic development pace is predicted for the nearest future.

3.1 Azerbaijan as Leadering Country in the Region and among CIS Countries
If oil extraction along with gas condensates composed 14.0 million tons in 2000 and 15.4 million tons in 2003, 41.7 million tons in 2007, the oil extraction of Azerbaijan was in the high in 2008, which is 44.5 million tons. According to experts- opinion, the increase of oil extraction in Azerbaijan is expected to be 50 million tons in 2009, but in 2011-2015 – the annual extraction will compose approximately 60-65 million tons. In 2003-2008 the economics of Azerbaijan increased 2.6 times, the poverty level reduced from %49 to %13.2, more than 766 thousand new workplaces were opened and the volume of State budget increased on more than 10 times. [4]
Besides it, with the help of active initiative of Azerbaijan the realization of the largest project in the region became possible due to main financial support. The oil-conduct Baku-Tbilisi-Djeykhan and gas-conduct Baku-Tbilisi-Erzurum was successfully finished and handed in exploitation and the economic value, got from realization of these projects (and also from political dividends) is immeasurable.
In present time the precipitant realization of construction project of transnational railway (Baku-Tbilisi-Kars) is still going on. The realization of this project alongside with transformation of Azerbaijan into an effective transitional transport main line also opens up profitable opportunities for a precipitant integration of the country directed to the European countries and several countries of Asia and also for enlarging of trade-economic connections.
Undoubtedly, the necessity of equilibration of priority directions formed in present dynamic development of the country and successful outcome of economic faults of globalization in the world economic system that is out of financial crisis, and also the necessity of the enrichment of economic development model of the country by the constantly renovating and progressive tendency of economic development is still preserved. To that end, the realization of the following points could be an important impetus for the economic development processes of Azerbaijan:

-the guarantee of realization of the projects, which contain big business in the industrial and production spheres of economic sectors and also guarantee of the conversion to modern technologies in these branches (modernization) taking into consideration the existence of important decisions of country leadership in the sphere of the wide industry development and the high traditional potential in the given sphere
-the guarantee of precipitant development of new priority non-oil sectors (informational-communicative technologies, touring and etc.) alongside with the existent industrial potentials and the guarantee of perfection of real arrangements and scientific-technical searches for realization of higher levels of the development in these spheres
-a settlement of legislative basis for organization of manufacturing of competitive production for raising of image of Azerbaijan on the world market
-an elaboration and acceptance of the development strategy next 20-30 years taking into consideration all spheres of social-economic development by way of intensification and inclusion of Azerbaijan to developed countries of the world.

IV. THE FACTOR OF THE NEW ECONOMI INSTRUMENTS IN THE PROCESSES OF ECONOMIC MODEL FORMATION IN AZERBAIJAN

The investigations show that, the attention is attract by the necessity of rational use of new economic method with an eye to constant enrichment of the economic development model for stable and dynamic development of the country. One of such progressive and effective economic methods is Special Economic Zones (SEZ) [5].
In 60-70-ies of XX century the processes of Special Economic Zones use by way of acquirement of big business were strengthen in the countries, which bring into action the most active economic instrument. The analysis show that the importance of free or special economic zones in the integration process of countries with transitive economics, which distinguish themselves by a direct proximity to the economic development processes of Azerbaijan into the world economic system will be observed. New young States formed after the collapse of the USSR began to look out on world market joining different integration processes on the stages of transition into the market economy.
The organization of free commercial zones in the CIS countries always stayed on the agenda and in connection with this agreement about the organization of free commercial zones was signed in Moscow (Russia) on April 15, 1994. However, the execution of this agreement, as many others passed within the framework of this structure was not realized; and that is why the organization of free commercial zones was proposed to be realized till 2010, according to the resolution sighed in Yalta (The Ukraine) in September, 2003 by the heads of countries, which are the members of this structure.
Last years the precipitant development of Azerbaijan national economics the improvement of investment environment the creation of new industrial branches and branches of conversion, the guarantee of goal-directed social-economic policy on the stage of transition to the market economics, the realization of serious steps about integration of the country into the world and European economics shows the precipitant inclusion of Azerbaijan into the world economic system. Also the structural researches in economics were intensified and the international collaboration sphere was extended.

4.1 The practice measures upon the use of new economic instruments
In spite of dynamic and stable development of macroeconomic index and index of social-economic life of Azerbaijan, the dependence of the economics of the country on oil-and-gas sector as the main sector, which attachés great importance to the forms of new national and progressive integration for guarantee of another economic sectors development is still retained in tact.
The possibility of the SEZ, which are remarkable for rationality and practice use level of these integration forms in the world experience to become supplementary stimulus for acceleration of economic development in Azerbaijan, especially when the rational use of production potential and infrastructure of industrial centre of Sumgait draws attention. In accordance with it the analyses show that the questions of the necessity of effective and consecutive organization of the above mentioned arrangements play an important role. Therefore, the creation of the first free economic zone in Sumgait was considered within the framework of “Development Program” of the UN.
However the mistakes, admired in the process of organization of this work and also the appearance of serious problems and obstacles hindered the realization of this new integration method of economics. So, analyses show that as the idea of transformation of Sumgait into the fully free industrial-export zone was rather a difficult problem from the beginning, the realization of this large project was not managed.
If the aimed direction of free economic zone, for example, taking into consideration the creation of such zones in industrial-manufacturing spheres (chemistry, oil-chemistry, metallurgy and etc.) of Sumgait, which got into the dead-lock in the beginning of the 90-ies, existed the realization of this project could be more real.

V. CONCLUSION

Having a great work experience in oil and oil-chemistry complex of Azerbaijan, in one of the main non-oil sectors of the country of (1981-2006) I am acquainted with the production forces of this branch, the possibilities of the infrastructure, shops and production, numerous perspective projects waiting for the realization in production. My participation in the process of preparation of majority of arrangements on restoration works of shops and productions, which have suspended their activity in chemical and oil-chemical sector, gives me an opportunity to come to conclusion of the existence of one of the optimum variants in the modern national economics of Azerbaijan for creation of free or special economic zones of the given sectors.
We came to conclusion that it is time we found an optimum answer to the question of SEZs could became a component part of active economic processes, which take place in Azerbaijan as a new affective integration means. Also we consider the joint activity of official representation of State Structure scientists, specialists in this branch, business person and those, who want the precipitant joining of Azerbaijan to the world economic system as an active integration country to be possible. In accordance with it, the investigations of such zones were the researches of the present interest in the period of acceleration of execution processes of edict about the organization of SEZs in Azerbaijan (# 538-06, March 2007) issued by Ilham Aliyev, the President of Azerbaijan Republic and also in a time of large probability of passing of the law about the SEZs in Azerbaijan in 2009. These zones alongside with playing the role of new effective economic methods for the countries, which conduct constant economic investigation by way of economic development maintenance, also have an opportunity for extending of the economic integration between different countries and rendering serious influence in solid development of various economic sectors.


Literature sources:

1. Porter, M. E. (1985) Competitive Advantage: Creating and Sustaining Superior Performance, New York: Free Press.
2. Hajiyev Sh.H. (2002) “ Azerbaijan on the pipeline to the world community: the strategy of the foreign economic development”, Kiev, 502 p.
3. The Statistic Committee of the CIS (www.minsk.bye)
4. www.economy.gov.az
5. Aliyev. Sh.T. (2008) “The Development Perspectives and Organization Problems of Special Economic Zones” Baku: Elm, 252 p.




Publication: International Business & Economics Research Conference
Place of publication: Las Vegas, Nevada, the USA
Date of publication: October 5th-7th, 2009

Web-page: http://www.CluteInstitute.com
Link:http://www.cluteinstitute.com/Programs/Las_Vegas_2009/Article%20142.pdf

Опубликовано на Порталусе 24 июня 2010 года

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